Global innovations in dairy
 

From traditional, family-run farms of several dozen animals, America's dairy sector is undergoing a metamorphosis into large-scale, feed-driven operations, many of which own more than 1,000 cattle. This ongoing consolidation process, while painful for small producers, has successfully reinvented the industry in a manner that has shaken up the world dairy market.

 

 

 

Based on USDA data, milk produced per dairy farming operation rose by 16 times over 36 years, while the number of American dairy farms fell by 90% over the same period.

 

Moreover, according to a recent Rabobank report authored by senior dairy analyst Thomas Bailey, despite being underway for three decades, the pace of consolidation has accelerated over the last decade.

 

The report states that, "the number of dairy operations in the US fell at a compound annual growth rate (CAGR) of 4.7% from 1970 to 2005."

 

He then notes how from 2005 through 2015, the number of dairy farms fell at an even steeper 5.9% annual rate. Interestingly, while the total number of dairy farms fell sharply, "operations with over 2,000 head (of dairy cattle) grew at a CAGR of 10% between 2002 and 2012."

 

While this has been very painful for small farms with fewer than 500 cattle, it has helped boost America's dairy industry competitiveness versus established world market suppliers.

 

From slightly over 100 tonnes per farm in 1970, the quantity of milk produced per US dairy producer rose to 350 tonnes by the early 1990s, 640 tonnes by 2000, 1,000 tonnes by 2010 and over 1,600 tonnes today. It is not coincidental that the largest increases in quantity of milk produced per dairy farm and exports occurred after the mid-1990s.

The full article is published on the April - June 2016 issue of Dairy Business Worldwide. To read the full report, please email to inquiry@efeedlink.com to request for a complimentary copy of the magazine, indicating your name, mailing address and title of the report.